Creative accounting challenging

Abstract

Many accounting principles and norms applied in nowadays accounting practice in Romania are more criticized according to accounting fundamental goal: faithful reflection of financial position units and situation. Derogation from accounting prescriptions constitute the compromise accepted by normalizing factors that creative accounting may use, in order to give financial situations information the required fidelity. Accounting normalization is outrun by the evolutions registered in economy and society. Since most economic situations have accounting consequences, finding solutions to new problems, even temporary ones, constitutes an unquestionable progress factor. Creative accounting solutions may constitute the support of a subsequent normalization. Creativity in accounting is natural in the evolutionary process of every socio-economic domain. What is the limit to which it can go is difficult to say. This depends on the effects that it produces on the ones interested on the accounting information. Ethics has an important role to play for keeping some reasonable limits regarding creative accounting. Creativeness is a virtue as long as it is used for finding better ways of solving the conflicts, of course with the condition of respecting the truth, even if this truth is only relative. At the beginning of synchronization the accountable Romanian system with the IASB concepts, regarding the accountable reform in Romania, the direction which this reform was going to take was uncertain, or even unknown. It was presumed that the British, being real specialists asked to contribute to the reform would bring with them the spirit of Anglo-Saxon accounting. This aspect was particularly favorable, being set in the realities of the actual period of time.